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Source Announces Nomura Voltage ETF Euro Listing

Eliane Chavagnon, London, 9 January 2012

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The London-based exchange-traded product provider Source has launched a euro version of its Nomura Voltage Mid-Term Source ETF on the XETRA division of the Deutsche Börse.

The ETF’s new currency listing provides a “euro-tradable listing for easy access to volatility via the efficient ETF structure” - accompanying its existing dollar listing on the London Stock Exchange, the firm said in a statement. 

In turn, European investors can implement a more tactical approach to volatility, capturing spikes and minimising the drawbacks of a “constant long volatility position”, the firm added.

“Volatility continues to be an attractive asset class for many European investors. The new euro listing will facilitate trading for euro-denominated investors and provide access to Nomura’s innovative voltage strategy,” said Ted Hood, chief executive.

The ETF, which tracks the Nomura Voltage Strategy Mid-Term 30-day USD TR Index, also offers volatility-adjusted exposure to the S&P 500 VIX Mid-Term Futures Index, a “highly-liquid and transparent volatility benchmark”, allocating between this index and three-month US Treasury Bills.

Allocation to the index ranges between 0 per cent and 100 per cent, depending on the volatility of that index. In other words, the higher the relative volatility, the higher the allocation, permitting a “reactive tactical model” which rebalances on a daily basis, unlike “vanilla options” or most OTC volatility instruments, the firm said.

Since its launch in April last year, the fund’s inflows brought its assets under management up to $166 million.

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